Derek Vaughan MEP

Working hard for Wales in Europe

Welsh Labour MEP urges Osborne not to protect broken bank bonus culture

A leading Welsh Labour politician has called on the Coalition government to accept EU proposals to restrain banker’s bonuses as part of a sweeping reform package designed to avoid a repeat of the 2008 financial crash.

Chancellor George Osborne will seek tomorrow to water down the plans, recently agreed by MEPs and the European Commission, at a meeting of EU finance ministers taking place in Brussels but Welsh Labour MEP, Derek Vaughan, has warned that the banking sector has had more than enough opportunities to reform themselves but had completed failed to do so.

He said:

"Under the new regulations, bankers’ bonuses will be limited to 1:1 salary to bonus ratio putting an end to the high risk culture in which bankers gamble with people’s lives and livelihoods, leading to taxpayer funded bailouts and bank collapses.

The changes, alongside requirements for banks to retain enough capital to withstand any shocks and for increased transparency, will go some way to learning the lessons from the past few years when bankers have played hard and fast at the expense of their customers.

At a time when UK banks are still paying out over £600m in bonuses despite losing billions of pounds of money and being fined £1.1bn for mis-selling and £390m for Libor-fixing, the need to tackle the culture of greed and self-reward is pressing.

It is sad to see that the UK is the only Member State out of the 27 opposing the tough new rules and that parties like the Tories and UKIP want to continue with the current unethical and unsustainable position, acting as unofficial spokespeople for elite, rich bankers."

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